OERC Releases Draft Grid Interactive Distributed Renewable Energy Regulations 2026 for Odisha

The Odisha Electricity Regulatory Commission (OERC) has released the draft Odisha Electricity Regulatory Commission (Grid Interactive Distributed Renewable Energy Sources) Regulations, 2026, aimed at establishing a comprehensive regulatory framework for the integration of Distributed Renewable Energy Systems (DRES) across the state.

Stakeholders have been asked to submit their comments by August 31, 2026, after which the Commission will finalise the regulations for publication in the Official Gazette.

The Commission said that it decided to withdraw its earlier draft regulations on Renewable Consumption Obligation (RCO), Distributed Renewable Energy Sources (DRES) and Renewable Energy Linked Concepts after receiving stakeholder feedback indicating that renewable consumption obligations and distributed renewable energy are distinct subjects requiring separate regulatory treatment. The new draft also seeks to replace the existing net metering framework issued in 2016 by incorporating recent developments in distributed renewable energy integration and the Forum of Regulators' Model Regulations.

The proposed regulations will apply to distributed renewable energy systems of up to 10 MW connected to transmission or distribution networks at voltage levels of 33 kV and below. Eligible consumers will be permitted to install DRES either independently or through Renewable Energy Service Companies (RESCOs) under various metering arrangements. The regulations also provide for government schemes to be implemented in accordance with Central or State Government guidelines.

A key provision of the draft mandates consumers installing DRES with capacities above 10 kW to deploy hybrid or grid forming inverters along with Battery Energy Storage Systems (BESS). The minimum storage requirement has been proposed at 10 percent of installed capacity for projects up to 100 kW, 20 percent for capacities above 100 kW and up to 500 kW, and 30 percent for projects above 500 kW and up to 10 MW. The Commission has also stated that BESS should preferably be charged during solar hours and discharged during peak demand periods.

The draft introduces six metering mechanisms for distributed renewable energy projects: Net Metering, Net Billing, Gross Metering, Group Net Metering, Virtual Net Metering, and Behind the Meter arrangements. Each mechanism specifies eligible consumer categories, project capacities and billing methodologies. Domestic consumers, government educational institutions, government hospitals, local authority buildings and agricultural consumers will remain eligible for Net Metering with project capacities ranging from 1 kW to 500 kW. Net Billing and Gross Metering will be available to all consumer categories, while Group Net Metering and Virtual Net Metering have been proposed to enable shared renewable energy benefits across multiple service connections.

The regulations also lay down detailed provisions for energy accounting, settlement of surplus generation, billing procedures and payment mechanisms under each metering arrangement. Surplus energy at the end of the settlement period is proposed to be compensated at Commission determined feed in tariffs through direct digital payments to consumers' bank accounts.

To support greater adoption of distributed renewable energy, the Commission has proposed exemptions from transmission charges, wheeling charges, cross subsidy surcharge and additional surcharge for eligible projects installed under Net Metering, Net Billing, Gross Metering and Behind the Meter mechanisms. However, charges may apply under Group Net Metering and Virtual Net Metering where participating consumers and DRES are connected to different substations or feeders. The Commission has also retained the option to introduce Grid Support Charges or Parallel Operation Charges through separate orders.

The draft further specifies hosting capacity limits, technical standards, metering infrastructure requirements, safety norms, application procedures and renewable purchase obligation accounting. Distribution licensees will be required to establish dedicated online portals, publish standardised procedures and update billing infrastructure within prescribed timelines to facilitate DRES implementation across Odisha.